risk_analysis

Death, injury and illness often strike without warning and can cause significant financial and emotional stress to those who are not well prepared.

Financial stress can be eliminated through the inclusion of adequate insurance in any plan or strategy designed to provide future financial comfort and security.

Recent New Zealand statistics (see sources below) show:

Approximately 82,000 males (20%) and approximately 56,000 females (13%) will die before reaching the age of 65.

Other Insurance

Apart from life cover there are a number of other risks that can be insured against. Statistics again show the necessity for this protection. Of the 415,000 males and 433,000 females in New Zealand currently aged between 30 and 45:

50,000 (12%) males and 80,000 (18%) females will experience at least one period of disablement lasting six months or longer

33,000 (8%) males and 54,000 (12%) females will experience at least one period of disablement lasting 12 months or longer

42,000 (10%) males and 55,000 (13%) females will be diagnosed as having cancer

39,000 (9%) males and 13,000 (3%) females will be admitted to hospital following a heart attack

27,000 (7%) males and 8,000 (2%) females will undergo open heart surgery

11,000 (3%) males and 5,000 (1%) females will suffer a stroke

While statistically life expectancy rates are improving, due to improvements in health and medical treatments, more are living longer with disablement, which reduce income earning prospects and savings.

These risks can be insured against with other products described on this site.

Source: New Zealand Life Tables 90-92, Public Hospital and Selected Morbidity Data 1994, Selected Morbidity and Hospital Data - Volume II - 1993, Selected Morbidity Data for Publicly Funded Hospitals 1995/96, Cancer: New Registrations and Deaths - 1992.

Q & A

Q. What happens when the family's bread winner dies?

A. In a case of premature death of a family's main or supplementary "bread winner" the first major problem faced by a family would be the repayment of all outstanding debt (mortgages, personal loans, taxes and funeral expenses). Repayment of such debt can be easily achieved by adequate life insurance cover.

Provision can also be made to establish an emergency fund or cash reserve to help a family through at least the 6 months immediately following the death of the breadwinner. Planned future capital costs i.e. children's educational needs, should also be incorporated into any calculation.

Q. How do families survive without the deceased's income?

A. A second but perhaps more pressing need for the family would be to consider replacing the actual current and ongoing income lost through the death of the bread winner. This is a much more comprehensive calculation because it must consider all possible expenses so as to allow for a capital sum, which invested today, will provide the desired income over the years to come. Consideration needs to be given to:

(1) The period dependent children remain as part of the household

(2) The likely years, if any, of employment of the surviving partner.

(3) The period in retirement.

Q. How can we solve the problem?

A. Download and complete the Risk Needs Analysis sheet which identifies the elements to assist you calculate the sum of insurance required to meet all immediate costs plus the repayment of debt personal and or business liabilities. As well it helps you calculate the amount of capital required to fund the family's income requirements.



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Death, injury and illness often strike without warning and can cause significant financial and emotional stress to those who are not well prepared. Financial stress can be eliminated through the inclusion of adequate insurance in any plan or strategy designed to provide future financial comfort and security. Recent New Zealand statistics (see sources below) show: Approximately 82,000 males (20%) and approximately 56,000 females (13%) will die before reaching the age of 65. Other Insurance Apart from life cover there are a number of other risks that can be insured against. Statistics again show the necessity for this protection. Of the 415,000 males and 433,000 females in New Zealand currently aged between 30 and 45: 50,000 (12%) males and 80,000 (18%) females will experience at least one period of disablement lasting six months or longer 33,000 (8%) males and 54,000 (12%) females will experience at least one period of disablement lasting 12 months or longer 42,000 (10%) males and 55,000 (13%) females will be diagnosed as having cancer 39,000 (9%) males and 13,000 (3%) females will be admitted to hospital following a heart attack 27,000 (7%) males and 8,000 (2%) females will undergo open heart surgery 11,000 (3%) males and 5,000 (1%) females will suffer a stroke While statistically life expectancy rates are improving, due to improvements in health and medical treatments, more are living longer with disablement, which reduce income earning prospects and savings. These risks can be insured against with other products described on this site. Source: New Zealand Life Tables 90-92, Public Hospital and Selected Morbidity Data 1994, Selected Morbidity and Hospital Data - Volume II - 1993, Selected Morbidity Data for Publicly Funded Hospitals 1995/96, Cancer: New Registrations and Deaths - 1992. Q & A Q. What happens when the family's bread winner dies? A. In a case of premature death of a family's main or supplementary "bread winner" the first major problem faced by a family would be the repayment of all outstanding debt (mortgages, personal loans, taxes and funeral expenses). Repayment of such debt can be easily achieved by adequate life insurance cover. Provision can also be made to establish an emergency fund or cash reserve to help a family through at least the 6 months immediately following the death of the breadwinner. Planned future capital costs i.e. children's educational needs, should also be incorporated into any calculation. Q. How do families survive without the deceased's income? A. A second but perhaps more pressing need for the family would be to consider replacing the actual current and ongoing income lost through the death of the bread winner. This is a much more comprehensive calculation because it must consider all possible expenses so as to allow for a capital sum, which invested today, will provide the desired income over the years to come. Consideration needs to be given to: (1) The period dependent children remain as part of the household (2) The likely years, if any, of employment of the surviving partner. (3) The period in retirement. Q. How can we solve the problem? A. Download and complete the Risk Needs Analysis sheet which identifies the elements to assist you calculate the sum of insurance required to meet all immediate costs plus the repayment of debt personal and or business liabilities. As well it helps you calculate the amount of capital required to fund the family's income requirements.


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